I ran the troubleshooter 3 times before it fixed all the errors it found.

Had this issue again. Here are some things to look for.

Make sure Windows is activated.

In the run window type in “msconfig”. You will need administrative permissions.
Check “Hide all Microsoft services”. Hit “Disable all”. It will ask you to restart. Do not restart. You will need to restart these when your done.

In “Services” make sure “Windows Update” and “Background Intelligence” is started.

BEST SOLUTION:
A couple of other techs I worked with discovered the first couple of Windows 7 updates need to be installed manually. After that the rest of the updates worked the way they should. They found the information here.